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development banks working in one to three districts should have such capital of Rs 500
million.

Key Point A development bank is the bank which provides capital and technical
assistance for the development of certain sectors such as industrial,
agricultural, rural sectors of the country.

12. Types of Development Bank

There are different types of development banks in Nepal. They are as follows:
Types of Development Bank

Agricultural Industrial Rural Development Private
Development Bank Development Bank Bank Development Bank

a. Agricultural Development Bank
The bank, which is established for the
development of agricultural sector of the
country, is called Agriculture Development
Bank. Agriculture Development Bank Ltd.
was established in 7 Magh, 2024 B.S. with the
th
authorized capital of 5 crore under the provision
of Nepal Agricultural Development Bank Act
2024. It provides loans to the farmers to purchase
agricultural tools and equipment, fertilizers, Agricultural Development Bank
seeds, etc. to increase agricultural outputs. It also
provides loans for the promotion and development of agro-based industries. Further, it
provides financial and technical assistance for farm development. At present, it provides
banking functions as well. It is converted into commercial bank from development bank
since 2 Chaitra, 2062. It accepts deposits from individuals and organizations grant loans
nd
to the needy organization and individual.

b. Industrial Development Bank
The bank which is established to develop the industrial sector of the country is
known as industrial development bank. It provides financial and technical assistance for
the promotion and development of the industrial sector of the country. It provides mid
term as well as long term loans to industrial organizations for constructing administrative
as well as factory buildings and installing plant machinery and equipment. In Nepal,
Nepal Industrial and Development Corporation (NIDC) was established in 2016 B.S.
under NIDC Act 2016 as industrial development bank. It had got authorised capital of
Rs. 25 crores at the time of establishment. On January 27, 2017 AD, the government has
decided to merge the NIDC Development Bank with the Rastriya Banijya Bank (RBB).

72 Aakar’s Office Practice and Accountancy - 10 Financial Institutions 73